Downside risk for US employment, magnitude of September Fed interest rate cut in question

The US CPI data is here ICYMI:

• Forexlive Americas FX news wrap: CPI continues to cool

And thoughts of a 50bp interest rate cut are gathering pace (we are a fickle lot aren’t we?):

• JP Morgan says the Fed has a green light for a 50bp rate cut in Sep. Here’s the trigger.
• Morgan Stanley flag potential 50bp Federal Open Market Committee (FOMC) Septembr rate cut

• UBS says doesn’t see reason for 50bp Federal Open Market Committee (FOMC) rate cut in Sept

TD are not quite so gung ho, but do mention it:

• latest consumer price report “checked the box” for the Federal Reserve’s Federal Open Market Committee (FOMC) to begin cutting at the September 17 and 18 meeting
• CPI
  report is again unambiguously welcome news for the Fed
• risks have become truly two-sided for the US
  economy, if not slightly tilted toward downward employment outcomes
• we expect the Fed’s upcoming decision to come down to the magnitude
  of the first rate cut

TD are wary that the market will come around to the view that inflation is stickier than the Fed was expecting though. And conclude that the magnitude of the September cut will depend on the data between now and the,

Federal Reserve Chair Powell will speak at Jackson Hole next week. Dropping clues I suspect.

This article was written by Eamonn Sheridan at www.forexlive.com.